Fleet News

Fleets clock up the miles as cars are kept longer

Fleets, dealers and car manufacturers must adapt to manage older, higher mileage stock on the used market, according to Manheim.

The vehicle remarketing company says the age and mileage profile of ex-fleet vehicles is continuing to rise and early evidence from 2011 shows it could increase further still.

Mike Pilkington, managing director of Manheim Remarket-ing, said: “The fleet sector is a barometer for our economy, and certainly for the motor industry, both in used cars and new cars.

We’ve seen an increase in both mileage and age over the last four years from 41 months to 48 months and from 50,000 miles to 59,000 miles.

“And this trend is continuing into 2011: at the end of February the average age was 50 months and average mileage was 61,000.”

He added that the trend was evident across the sector, with the proportion of vehicles at 90,000 miles or more increasing from 12.89% in 2008 to 16.27% in 2010, with the percentage of vehicles with more than 100,000 miles on the clock rising from 8.25% to 10.98% over the same period.

“It’s a trend that’s important for fleets and remarketing companies giving us a fresh challenge, and it’s also important for vehicle manufacturers.

“They need to establish how they can help dealers retail older, higher mileage cars.

“It will become a key issue over the next few years as the lack of availability of new cars in the last few years will also affect the cars coming back on to the market.”

Pilkington added that fewer new car registrations in recent times and over the next few years compared with pre-recession levels should lead to a more stable environment for used car values.

According to Pilkington, although retail demand will be lower than before the recession, it will be balanced with constrained supply.

He said current demand was strongest for small cars and diesel cars, reflecting a desire from consumers to choose something less expensive to run.
Cars that have a good specification and colour, and that can be placed before consumers quickly – with minimal damage – are most successful.

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